Abstract

This paper uses survey data from a questionnaire for brokers given to Kaohsiung realtors in order to explore the effect of the threat of peer competition on an individual's performance. In the empirical model, the branch "average performance of other agents" is used as the proxy variable for peer competition, and the hierarchical linear modeling (HLM) model is applied for estimation. The empirical results suggest that the average performance by other agents has a significant negative effect on an individual's performance. In branches that have more "agents" or have a "team compensation scheme", the effect of other agents' average performance on an individual's performance is significantly higher than that for the branches with fewer "agents" or without a "team compensation scheme". These findings are consistent with theoretical expectations.